1. Pay as much as possible on your smallest debt first
You start by putting all your extra money towards paying off your smallest debt first while still paying the minimums on all your other debts.
2. Pay off your next smallest debt with your bigger snowball
Once your smallest debt is paid off, you’ll throw everything you can toward paying off your next smallest loan, while still paying the minimums on everything else. You’re not paying on the first debt any more, so you’ve got more money to roll into a snowball to throw at your new target. And your snowball will get bigger as you pay off each debt!
3. Keep going until you’re debt free
Keep working on paying off your next smallest debt until you’ve paid them all off. And when you’re done, remember to celebrate!
Consider Debt Avalanche
Debt Avalanche is a repayment plan that helps you save money overall by paying down the debt with the highest interest rate first. Once that’s paid off, you’ll put all of your extra money toward paying off the debt with the second largest interest rate, and you’ll continue doing that until you’re debt free.
Track your debt payoff progress with a budget that works
Use Goodbudget to track your debt payoff progress. Whether you use the debt snowball or another method, you can use Debt Accounts on the web to track your payoff progress and create budget that works with the repayment plan you choose.